Howdy, this is Coffee Shop Keys, the newsletter that serves as your morning polar plunge into an ice cold water tank. ✌️, Tom
Here's what's in this month's issue:
Cold brew - do customers want it?
Do people like cold brew?
People LOVE cold brew. And that love is expected to grow - a lot.
According to research by Grand View Research, the demand for cold brew coffee has been increasing in recent years and shows no signs of slowing.
Who is drinking all this cold brew?
The short answer: young people. According to Statista:
"Cold brew coffee holds greater appeal with younger consumers in the United States. In 2020, almost half of respondents aged 25 to 39 rated the beverage as either excellent or very good, compared to just 15 percent of those aged 60 and over."
Young people (aged 39 and younger) are driving the demand for cold brew coffee.
As the Gen Z demographic (younger than 25) enters into adulthood and the workforce, they are making coffee decisions. Increasingly, those decisions are cold beverages.
Why do people want cold brew instead of hot coffee?
I don't have data to back up these points, but anecdotally, there are several reasons I've found to choose cold coffee:
1. It maintains its temperature better
Hot coffee doesn't stay hot for very long. When I order hot coffee at a cafe, I typically drink pretty quick, but I know that if I don't, my drink will chill to an uncomfortable temp in 15 minutes or so in that measly paper cup.
However, an iced drink will stay cold for over an hour before I start to consider dumping it.
2. Younger generations consume coffee differently
Older folks (yes, fellow millennials, I mean you, too) will remember Starbucks' meteoric rise and proselytization of Italian-style espresso-based beverages.
But Gen Z wants something different.
They don't necessarily drink coffee first thing in the morning to get that sweet, sweet caffeine jolt.
They're accustomed to coffee in big, cold cups that can be consumed in the late morning or even afternoon.
Espresso-based drinks are an Italian import. Cold brew can be our own thing.
3. Coffee is getting closer to energy drinks
Cafes like Dutch Bros. and others are serving up energy drinks on the same menu right next to their coffee drinks.
Why?
Cafes are blurring the lines between these two caffeine vehicles because that's how consumers are drinking them at home.
Not everyone likes the taste of coffee, but wants some of that wake-up chemical, thusly, energy drinks.
So, friends looking for an afternoon pick-me-up can find something for them whether it's cold brew or an energy drink without making multiple stops or compromising.
4. It tastes great and is easy on the gut
Hot-brewed coffee can carry some acidity which adds to flavor, but wreaks havoc on the stomach of those with acid reflux or other gut sensitivities.
Brewing coffee at colder temps rounds out the flavor to be a little more smooth and less acidic.
Cold brew - is it worth it?
In a word, YEEEAAAH!
Cold brew is extremely profitable for these reasons:
It doesn't require expense equipment to make – No espresso machine required!
It takes barely any labor – Sure, there's a bit when initially brewing it, but after that, it's a quick pour.
It has a long shelf life – Here's the thing. Brew a big batch of cold brew and it'll last at least a couple of weeks in your undercounter fridge. Espresso, though? Phew, toss it after a few minutes.
Almost no wasted coffee – Dialing in an espresso machine every few hours could eat into a lot of product. Cold brew is much less temperamental, with no need for "dialing in" after the recipe is perfected.
The margins are HUGE – Cold brew coffee drinks can command a high price. Considering the low Cost of Goods Sold and minimal labor, the profit margins on these beverages are likely the highest on your menu.
How do I serve it?
Example Cold Brew Coffee Drink Recipes
Here are some examples of how to serve cold brew coffee (because just straight up can be kinda boring).
The classic cold brew coffee with ice and water
Cold brew tonic – cold brew + sparkling water (Topo Chico) = a match made in heaven
A cold-brew-based iced latte
Steamed cold brew – Yup, that's right. Put that cold brew and some water into a pitcher and let 'er rip. The end product will be light and foamy with a smooth chocolate/caramel taste.
Nitro cold brew – Okay, there's a bit of specialized equipment required here, but this stuff is TAST-EE!
Cold brew lemonade – Sounds weird, I know. But it actually tastes great. This is basically an Arnold Palmer with cold brew instead of tea. Sweet and refreshing.
Coffee cocktails – Want to get a little crazy? Add some booze to the drink.
I hope you hop on the cold brew train this summer and your coffee shop is all the better for it.
Hey, thanks for reading.
Here are some things I hope put some pep in your step.
